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Does your Ecommerce store have a physical location? Are you capitalizing on the benefits of location-based marketing?

Location-based marketing is the act of increasing customer referrals, loyalty and word-of-mouth marketing by allowing users to share and recommend places based on their physical location. Websites such as Yelp, Gowalla and Foursquare are dedicated to these efforts and they can assist retailers with boosting sales and customer interaction and engagement on social media platforms.

The Platforms

First, you must understand the technology of how these websites work. Research the two most popular sites, Foursquare and Gowalla to get a feel for what they offer. Related applications take advantage of GPS in mobile phones to allow users to perform a variety of functions in association with your retail location.

When customers arrive at your store, a user can “check-in” to your location which is seen by the friends of this user on social networks. They can add comments, share photos with their Facebook and Twitter friends and perform many other activities. With Foursquare, they can collect points and virtual badges the more they “check-in”. Armed with this information, you can start competitions, offer “check-in” discounts, badges and prizes to increase the number of customers coming to your store.

Make Yourself Known

If you are just starting out, set up your profiles on these location-based platforms and ensure your address is correct. You should also advertise your new involvement by sharing it with your current customers. Own a cupcake store or a bakery? Make new cupcakes with a foursquare symbol on top or put notices on the counters and tables. Add the information to brochures and store windows. You should always remind people to “check-in” when they come to your store.

Incentive

You must offer incentives if you want customers to get involved and share their experiences. You can offer a prize for the 100th “check-in” or a free product after the 10th “check-in”. You can run prizes for best photo in front of the store or the craziest order combinations. Anything that will get more customers in the door and help them to enjoy their visit will boost your location-based marketing efforts.

Raffles (e.g. “Every person who checks in gets a chance to win an iPod.”)

Specials for the user who checks in most often. This is a staple of Foursquare promos for a lot of venues (e.g. “Top user/mayor gets the first drink free every time he/she comes in.”)

First check in specials (e.g. “Get 30% off your order when you check in for the first time.”)

Digital punch cards (e.g. “Check in 5 times, get a free coffee.”)

Advertise particular incentives, rather than your business in general (“20% off between 2 and 4pm;” “Buy one burger, get one free;” etc.).

On platforms that allow you create your own banner ads (such as Loopt), include your address and opening hours in the ad itself, when possible.

Watch and Observe

Walk around your neighborhood and take a look at what your peers and competitors are doing with their location-based marketing campaigns. Check-in to some of these places and see what customers are sharing and how interaction is enhanced. Start getting the creative juices flowing.

Track

Once your campaigns are up and running, make sure to track how well they perform. You may need some trial and error experience to determine which campaigns fare the best with your customers. Understand, though, that your ROI may not be that easy to assess. Remember that with your increased sales, you will also be raising brand awareness and exposure which will boost your sales in the long run as well.